IDACORP, Inc. ($IDA)

[Audio gap] Mike Kennedy, Scott Madison, Karen Miller, Susan Morris and Dr. Mark Peters. All of our directors and nominees with the exception of myself qualify as independent directors. All of the current directors have been nominated for reelection at today's annual meeting, and we have one new nominee as candidate for our Board, Sharon Miller. Sharon recently retired as President North America of Lamb Weston. She brings a wealth of global business sales, customer operations and supply chain insights to our Board, along with strong ties to Idaho Power service area. Information on each director and nominee can be found in the proxy statement for this annual meeting. Before I move on, I'd also like to recognize our officer team. Their leadership and service make us the successful organization we are today. Their impressive and varied biographies are on the IDACORP website. We have an outstanding leadership team that is excited about our business and committed to serving our customers, employees and you, our owners. For today's meeting, we'll start with the formal business, and then Brian Buckham and I will provide additional comments about our company. We'll end with a Q&A session. And of course, our management team welcomes questions from our owners outside of this meeting as well. Today's presentation contains forward-looking statements that relate to future events or expectations. I'd like to remind everyone that the company's future results could differ from those discussed at this meeting. Factors that could cause future results to differ materially can be found in our filings with the Securities and Exchange Commission, including our 10-K and 10-Q reports. I encourage you to review those documents, other documents we file with the SEC and our press releases for material information about our company. It is now my pleasure to officially call the 2026 Annual Meeting of IDACORP shareowners to order. The annual meeting is being held to address three items: To elect 10 directors for a 1-year term, to address an advisory resolution to approve executive compensation, and to ratify the appointment of Deloitte & Touche as our independent registered public accounting firm for 2026. IDACORP has approximately 139,000 shareowners located throughout the United States and internationally. The results of shareowner voting for the annual meeting are typically determined by the return of proxies from shareowners who are not present, and we have those results today. Before moving on, there are a few administrative matters that need to be addressed. First, a majority of the shareowners voting power outstanding is represented at this meeting by proxy. Consequently, we have a quorum. Second, in accordance with the IDACORP bylaws, no matters other than those stated in the proxy statement or that have been properly raised by a shareowner in advance considered at this meeting. Finally, if you have not already voted your shares, you may do so now by following the voting instructions provided in the virtual meeting e-mail sent to you this morning. The first item of formal business is the election of directors. 10 director nominees are up for election at this meeting. All 10 have been nominated for 1-year terms to expire at the 2027 Annual Meeting. The second order of business is the advisory resolution to approve executive compensation commonly referred to as the say-on-pay vote. The third order of business is to ratify the appointment of Deloitte & Touche as IDACORP's independent registered public accounting firm for 2026. The company's Board of Directors has unanimously recommended a vote for each of these proposals. The IDACORP proxy holders have voted all shares represented by proxy as submitted on all three matters. Based on the proxies, the preliminary results of voting indicate that each of the 10 director nominees named in the proxy statement has been elected for a 1-year term, and all proposals have passed. At this time, the voting has now closed. This concludes all items scheduled for action at this annual meeting. The business portion of the meeting is now adjourned. As we move to the informal portion of the meeting, I'd like to start by thanking our employees for the great work they did during an especially busy and exciting year for IDACORP and Idaho Power. Their dedicated service continues to drive strong results for our customers and our owners. During 2025, our company produced its 18th consecutive year of earnings per share growth, sold a record amount of energy to customers, broke ground on the Boardman to Hemingway transmission project and achieved the best reliability scores in Idaho Power's history. I'm so impressed with the incredible work our team is doing to help build a secure energy future for our company and our customers. Customer growth remains strong for Idaho Power. Our customer base grew by 2.3% in 2025. We now serve more than 660,000 customers and a population of more than 1.4 million. The growth across our region is robust, and it's happening across most customer classes, spurred by extensive residential, commercial and industrial construction. We expect this growth to remain strong as our local economy continues to outperform national trends. Notable large customer projects are making significant progress. Micron's new semiconductor facility is advancing towards completion, and we're also working through the details of Micron's second fabrication facility announced last year. Meta's Data Center has reached the testing and commissioning stage. We're starting to see loads and revenues increase from these projects, which will continue throughout this year. Idaho Power brought several additional industrial projects online in 2025, including the new Tractor Supply distribution warehouse and a major expansion of Chobani field group production facility. We continue to see steady interest from many of our core industries of food processing, manufacturing, distribution and warehousing as well as inquiries from other energy-intensive customers looking to operate within our service area. We work closely with prospective customers to set realistic time lines to meet their energy needs while ensuring they are not shifting across to other customers. As we serve one of the fastest-growing areas in the nation, we're doing it thoughtfully to ensure that growth pays for growth. As we work to meet growing energy needs, affordability remains a top priority. We work hard to keep our costs down and provide exceptional value for our customers, and our rates remain 20% to 30% lower than the national average. Our rates are also increasing at a slower pace than many other utilities. 23% over the past decade compared to 41% nationally. Our price history also compares favorably to the consumer price index, which has gone up 36% over the same period. The benefits of our low-cost system and hydro generation, in particular, helped with our affordability focus. We also work with our regulators to help keep rates low. Our 2025 general rate case in Idaho reached a constructive outcome via a settlement. The new rates are helping us to recover costs to support our operations, and based on current projections, we are not planning to file a general rate case in 2026. We are full speed ahead on the major transmission projects we are building to serve our customers. After breaking ground on B2H last year, 260 towers have been completed, representing about 20% of the towers for the project. In addition, we have completed nearly half the access roads and structure pads for the project. We expect B2H to be in service by late 2027, and we're excited to add this important transmission resource to our system. Permitting is nearly complete on the Swiss North transmission project, and we expect construction on that line to begin this year. We anticipate Swiss North will be done as early as 2028. We're also working on [indiscernible] on the Gateway West Transmission project. We anticipate a critical section of that line between our Hemingway and midpoint substations will come online as early as 2028. Permitting transmission lines takes a lot of time and effort, and I want to recognize the great work that teams across our company have done to move these projects forward. We continue to add generation and storage resources that will help us maintain excellent reliability as demand grows. In 2025, the 200-megawatt Pleasant Valley Solar project came online as part of our Energy Year Way program, and we added 230 megawatts of battery storage to Idaho Power's resource portfolio. We are adding another 250 megawatts of batteries and 125 megawatts of solar this year. Both of those projects are nearly complete. Idaho Power has announced plans to construct 167 megawatts of natural gas fuel generating capacity next to the existing Senate Mountain power plant, which is slated to be online in 2028. We're proud this company-owned project was the most contact resource in the [indiscernible]. We're also working hard to solve the generation needs in 2029 and 2030, and we're working to procure additional resources to solve those deficits. We filed CPCN for two additional natural gas plants. We plan to bring the 222-megawatt South field project online in 2029 and the 430-megawatt Paragon project is slated for operation in 2030. Full units as of omni plant has been converted from coal to natural gas and are ready for our summer peak this year. This February, Idaho Power entered into an agreement with the Origin Trail Electric Cooperative for the sale of our distribution system with some transmission assets in Oregon. If the transaction is approved, we would have no regulated retail operations in Oregon, so we provide power to OTECH, for some time under a power purchase agreement. Base purchase price is $154 million, and the deal is subject to approval from state and federal regulators. [ Oregon ] represents a small portion of our service area, projected to be less than 3% of total sales by 2030. We're confident OTC will provide a strong local focus and dedicated service for Eastern Oregon, while Idaho Power concentrates on supporting our rapidly growing Idaho community. Idaho Power would no longer directly serve Oregon customers we would retain ownership of our Oregon generation facilities and most of our Oregon transmission, including B2H. We're working closely with OTECH to prepare for a smooth transition. I will now turn the time over to Brian for a financial update.

Thanks, Lisa. We spent a lot of time talking about the financial side of the company on our recent earnings call. So I'll be brief in my comments today on that. I'll start by pointing out that we had another strong year in 2025. We achieved the unprecedented 18th consecutive year of earnings growth that Lisa mentioned earlier. The customer growth, constructive regulatory outcomes and our Idaho earnings support mechanism have all helped the company continue this impressive trend, all while maintaining affordability for our customers. We just spoke about what we're doing on the operational side to address growth and the continued reliability of our system. On the financial side, we're working in parallel, executing our plan to finance and earn our return on the investments that we're making. On the more quarter earnings call, we noted that we're forecasting spending around $1.4 billion per year on average over the next 5 years and a total 5-year CapEx plan of $7 billion. As was the case last year, we're again doubling our average annual spend compared to the past 5 years. In fact, our 2026 to [ 2030 ] forecast is a 26% increase in CapEx compared to our prior 2025 to 2029 forecast of CapEx. And I note that there's still potential upside to the forecast. It depends on the outcome of our latest RFP and potential resource needs from prospective incremental industrial projects. Financing and building the needed infrastructure is just one element of our execution. We also have to convert it to rate base to keep the utility financially healthy and to provide returns to the debt and equity holders that are funding our growth. Coming out of our most recent Idaho case, our rate base with the end of 2025 was about $5.3 billion and a similar story to last year, we have made rate base more than doubling over the next 5 years, increasing to around $11 billion by the end of 2030. That will require us to be thoughtful about frequent regulatory actions and also balancing the financial needs of the company and customer affordability. As we look ahead to funding our growth, we have a strong balance sheet, and we intend to keep it that way through this growth cycle with an average 50-50 debt equity capital ratio target as of now. The external financing, we noted on our fourth quarter call, the estimate we need for 2026 to 2030. Just for the capital that we have in the plan as of right now is about $2 billion in equity, about $2.9 billion in debt today at that ratio. We already executed or settled on Forward Dale agreements on around $750 million of that equity need as of the end of the first quarter. So we're well on our way to executing on the plan. I want to reiterate something else Lisa mentioned, as we progress through the growth cycle, we're remaining focused on maintaining affordability for our customers. Our approach to contracting with new large industrial projects is focused on protecting existing customers and our shareholders from potential negative financial impact as well as being transparent responses to the new customers. Customer growth in the denominator of our regulatory equation helped to absorb what might otherwise be larger rate increases for our existing customers. So we're fortunate that the Idaho regulatory process as the growth pace for growth methodology. This year and more so next year, we anticipate some notable industrial revenue growth, and that's a large part of why we're not planning to file a rate case this year. It demonstrates that the growth pays for growth construct in Idaho works. As we've noted in the past, when we continue to believe IDACORP is among the leading earnings growth and earnings quality profiles in the industry. We have a demonstrated CapEx needs for our growing customer base. We have a path to affordable conversion to rate base and earnings. Our commitment is that we'll keep focusing on solid execution. I'll close with a quick note on our dividend, which increased 2.3% last year, that was our 14th consecutive year with in that increase with cumulative growth of 193% during that span. We're proud our company has paid a dividend every quarter since 1944. And with that, I'll turn the presentation back over to Lisa.

Thank you, Brian. As we conclude, I want to reiterate my thanks to our outstanding employees and leadership team and our exciting, challenging times in the energy industry and thankfully, this is where we thrive. IDACORP and Idaho Power are committed to balancing safe, reliable energy with affordable prices that we grow. Our employees are dedicated to our core values with safety first integrity always in respect for all as we work to support the communities we serve. The environment we share in the places we call home. Their hard work and innovation -- innovative problem solving continues to drive strong results for our company. our customers and our owners. Thank you for your continued trust in IDACORP for investment, and thank you for joining us for this annual meeting.

With that, we're ready to begin the question-and-answer session. You should see a QA icon near the bottom of the webcast screen. You can click that and submit a question, and we'll take as many questions as time permits on a first comp basis. So we'll start with a question about really the growth pace for growth methodology, just given the increase of all these big data centers and big loads what is that doing to rates for customers. And again, in Idaho, we actually are very careful. We've talked about that in our comments. We want to make sure that there aren't cautious and our regulator requires us to conduct a no-harm analysis when we segment the energy services agreements for approval. So as Brian mentioned, that is showing that it works. And the costs are being appropriately directed to what is causing the path. And so we're -- we feel really good about that. Another question, there's a couple of questions sort of asking about what's going on in the Middle East and how is that affecting our business and our plans. And certainly, in general, inflation and some of the supply chain constraints have impacted us over the past few years, not just the Iran conflict. So we've been sharing that in our quarterly calls and update. It is worth noting, though, that we have a very large fleet of vehicles because we drive 10 million miles a year. But certainly, we're seeing the increased cost in O&M there, just from the increased gas prices as an example. Another couple of questions we're really asking about our portfolio, our generation portfolio, our clean energy goal and just sort of how we're navigating through this large load -- large growth cycle. So it is true that we set a goal for -- to have the 100% clean into 2045, but it's a goal, and it's an aspirational goal. And we have said all along that we really need technology to produce resources that we could afford that are commercially available and at competitive prices to reach that goal. And again, we set that goal prior to this growth cycle. We still -- our primary business goal is our obligation to serve. So we have to serve this load, and we have to do it in a way that is safe, reliable and affordable. And clean, if we can manage the first three first, it has to be in that order. So we are working through all of that. And as we work through our IRP, that is where we look at the portfolio, and we produce the least cost least risk portfolio, and that is what binds our decision making. And right now, gas is about the only thing that you can build in the time frames we need that have the operating characteristics that -- to serve this load reliably. So it isn't -- we continue through the IRP process to model a 100% clean portfolio. The world has changed a lot. And so we are still navigating through it. And we will continue to still look at it, and we're hopeful that things like SMRs or hydrogen or some other fuel cells, something will show up that would be able to we could add to our portfolio so that we can continue to serve in a state reliable, affordable way. So it isn't that we're back tracking. It's just simply that we're moving forward and adapting to the world we live in. So -- and we will continue to do so. So I think that pretty much closes out the question that that are -- that we've seen so far. So I think with that, I will say thank you again for attending the annual meeting and for your questions, and we appreciate your investment in IDACORP, and we look forward to connecting again at future annual meetings. And hope you have a great day. Thank you.

All right. Thank you, everyone. Congratulations. Elizabeth, if you're on the line. I'll have the...